Step toward fairer regime for local industry on major works

The ASI has welcomed the Australian Government’s response to the report it commissioned on implementing measures to extend the requirement for Australian Industry Participation Plans (AIPPs) for projects benefiting from substantial taxpayer dollars.

The new measures were developed by the Australian Industry Participation Working Group foreshadowed by Prime Minister Julia Gillard at 2011’s Jobs Summit in Canberra.

ASI Chief Executive, Don McDonald said that with the measures focused mainly on facilitating more transparency to major project procurement processes, they would go some way to lifting awareness on the level of local industry engagement.

“We welcome yesterday’s announcement by Industry Minister, Greg Combet that addresses a number of issues we have been advocating strongly over several years to facilitate a fairer regime for local industry on major projects,” he said.

“The measures outlined will place a bigger onus on major project proponents to spell out to the Government how and to what extent they engage with local industry.

“However we would urge breakdown details to be made more publicly available to allow local industry to better access opportunities to value-add projects.

“It is important that local value added content is published at a level where key components such as steel can be distinguished to help local industry better align and further develop capabilities to match the needs of the booming resources sector.”

The ASI has for some time urged that AIPPs be mandatory for all projects worth more than $100 million.

“It’s also vital to extend mandatory AIPPs to other projects benefiting from taxpayer dollars such as recipients of Clean Energy Fund assistance,” Mr McDonald said.

He also pointed out that reference to integration with global supply chains in the Government’s response should not preclude projects on home soil being specified to Australian standards as specification to foreign standards on a number of recent projects has been used to effectively bypass local industry involvement.

“The broad framework presented is definitely a step in the right direction to better balance major project procurement but with the devil being in the details, we will be monitoring implementation closely.”